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Why Should Manufacturing Units Adopt a Cloud-Based System?

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The manufacturing industry is continuously adapting to new changes and technology. But few could have predicted the level of the outbreak that happened in 2020. As a result of this extreme shift, many manufacturers are considering cloud solutions.

The cloud is enabling a new era of modern manufacturing. However, if you’re one of the manufacturers still skeptical about running infrastructure in the cloud, continue reading on.

This blog explains what cloud-based software is, the main benefits of switching to the cloud, how it differs from on-premise systems, and which cloud-based system you should choose.

What is cloud-based software?

Cloud-based software allows users to access the software applications that run on shared computing resources (for Example, processing power, memory, and disk storage) via the Internet. As a result, cloud-based ERP & traceability solutions offer an incredible range of possibilities and advantages to large and small manufacturing businesses.

Moreover, cloud-based systems are excellent for cross-factory collaboration. For Example, when two factories have different ERP systems used locally, a cloud system can improve both communication & collaboration.

In today’s times, cloud-based software is not only helping manufacturers in transforming their supply chain, design, and production processes but is also helping in driving innovation, accelerating growth, and enhancing the customer experience, all while reducing IT costs.

Let’s dig deep into the advantages of using cloud-based software in manufacturing.

**Benefits of using cloud-based software: **

 

1. Low Monthly Costs Commitment

Cloud-based implementations usually require less development and testing resources. Also, cloud manufacturers generally provide much of the application support and maintenance.

Many studies found that organizations that switch to cloud-based applications spend 40% less on consulting and 25% less on support staff than organizations that deploy on-premise applications. However, on-premise systems require a hefty set-up fee. And many costs are associated with maintaining them.

With cloud-based software, you’re aware of exactly how much you’re paying each month. This payment involves any ongoing updates of the software along with any support that your unit requires.

Hence, switching to the cloud can significantly reduce costs as it requires a low monthly cost commitment.

2. Quick Installation and Less Maintenance

A quick and active response is critical if any unexpected events take place. For example, if any competition takes market share in a matter of months. In that case, on-premise applications are usually not fast enough to expand, structure, and scale up operations, which can put your company at a disadvantage when faced with other fast-growing businesses.

This is the time when the cloud can come to the rescue. With the cloud, deployments are faster, you can quickly install the software, and there are fewer slowdowns during implementation.

Moreover, they require no on-site installation or local teams to maintain. Hence, no need to invest capital in upgrading your infrastructure or in maintaining it.

3. Improved Efficiency and ROI

With cloud applications, you can automate several traditional steps of your manufacturing processes and replace them with manual activities. As a result, cloud applications are considered best-suited for improving the overall efficiency of your manufacturing operations and boosting the ROI.

With a cloud-based ERP system, you can enhance your collaboration between departments, external suppliers, and distributors.

Furthermore, you can focus on the early detection capabilities and get real-time access to information about your stock availability, capacity, qualifications, equipment, tools, materials data, and the interdependencies of employees. All of this helps to improve manufacturing efficiency and hence the ROI.

Cloud-based software vs. on-premise software

On-premise software needs to be physically installed on every computer. Moreover, you need to maintain a server and hire a dedicated IT Team for it. And, most importantly, manage the data storage and security.

If an on-premise software solution ever needs to be fixed, it cannot be done remotely and involves further costs.

However, when you switch to cloud technology, you stay ahead of the curve. You can work remotely, securely, and the best part is that it is a proven way to facilitate your manufacturing business growth.

Which cloud-based system should manufacturers use?

Having different software for each business area can be limiting. But, when you opt for manufacturing software, not only does it have all the above-mentioned perks, but it also consolidates all your activities into one system. This involves inventory management, accounting, contact management, e-commerce, and production planning aspects.

For example, if a sale occurs on your e-commerce platform, this will then be reflected in stock levels; it will also filter through to your finances, which means your accounting team will always have a consistent snapshot of your business’s overall financial health.

While choosing cloud-based software for your business, keep in mind how accurately it captures the data and how powerful its reporting capabilities are. This way, you can make invaluable predictions around market trends, product demand, and customer behavior.

Conclusion:

Manufacturers will experience organic growth in the coming years due to pent-up demand from businesses, new product diversity and categories, technology-savvy consumers, and greater geographic reach. All this growth in manufacturing promises two things: *Mergers and acquisitions will increase *The trend around better data management for business analysis will only grow more heated.

 

Considering all these factors, manufacturing businesses are predicted to run profitably with cloud-based software. All in all, the cloud is gaining adherents across the industry.

 

Source: Manufacturing Cloud-Based System

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